A production possibilities table for two products, Consumption goods and Capital goods, is found below. Usual assumptions regarding production possibilities are implied. Consumption goods are measured in tons, and Capital goods are measured per unit. Combination Consumption goods Capital goods A B 18 33 D 45 3 54 60 E 2 F 1 G 63 i. Sketch a production possibilities curve from the above information. ii. Using the information given in the above schedule, describe the concept of increasing opportunity cost. iii. Suppose the economy is producing at a point inside the PPC. Give at least two reasons why this could occur. What could be done to move the economy to a point on the PPC? 4549

A production possibilities table for two products, Consumption goods and Capital goods, is found below. Usual assumptions regarding production possibilities are implied. Consumption goods are measured in tons, and Capital goods are measured per unit. Combination Consumption goods Capital goods A B 18 33 D 45 3 54 60 E 2 F 1 G 63 i. Sketch a production possibilities curve from the above information. ii. Using the information given in the above schedule, describe the concept of increasing opportunity cost. iii. Suppose the economy is producing at a point inside the PPC. Give at least two reasons why this could occur. What could be done to move the economy to a point on the PPC? 4549

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter2: Productions Possibilities, Opportunity Costs, And Economic Growth

Section: Chapter Questions

Problem 6SQP

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